About

You'd think that the Internet and mobile apps would be fantastic ways to help people manage their money. So why do so few of us in our 50s and 60s take advantage of personal financial management online and mobile tools from banks, credit unions and tech companies?

Only 16 percent of boomers use these types of tools (compared with 44 percent of Gen Yers), according to a new survey of 1,115 consumers by Aite Group, a financial services research and advisory firm. Half of the users of Mint.com, the big gorilla in the personal financial management world, are 25 to 34 and rent their homes, suggesting to me that boomers aren't big Minters.

Why These Tools Should Be Helpful

And yet our generation generally has far more in assets and more complicated financial lives than people in their late 20s and early 30s. "Between checking accounts, savings accounts, 529s for the kids' or grandkids' college costs, 401(k)s, stocks and bonds, that's a lot of information to keep track of," says John Breyault, vice president of public policy at National Consumers League, which recently played host to an online chat about these tools with Chase Blueprint.

So wouldn't it make sense that we'd be manic users of websites like Mint and Yodlee, software programs like Quicken and the latest money apps to manage our finances? As Sally Greenberg, executive director of the National Consumers League, says: "Personal financial management tools give consumers a powerful way to keep track of multiple credit cards and their bank and retirement accounts."

But most boomers don't. Is it us or is it them (the financial institutions and other tool creators)?

Turns out, it's a little of both.

Little Interest in Money Management

As much as it pains me to say this, many of us aren't interested in managing our money. Only about 10 percent of boomers are "highly engaged in their financial lives," says Ron Shevlin, author of the Aite Group report. Truth is, money management can be a time-consuming chore and sometimes confusing.

It stands to reason, then, that if you're a midlifer with a passel of 401(k) accounts, IRAs, mutual funds, bank accounts, credit cards and loans, you can be easily turned off by the thought of laboriously inputting all that data into a program that may or may not be helpful. (If you've ever tried to type your portfolio into an iPad, you know what I'm talking about. )

And yet, people who make the effort to use personal financial management tools often change their habits as a result, shoring up their finances.

Phil Christian, general manager of Chase Freedom, said at the online chat that his company's Chase Blueprint users are more likely to pay down their credit-card balances faster, pay bills on time and save on interest charges than bank customers in general.

The Disappointment of the Money Management Tools

After attending that online chat, I came away thinking that the money tools have largely been a huge disappointment.

They're fine for letting you know what you've got, which is why they're especially popular with young people trying to budget for the first time. But they're not so great if you're trying to figure out what to do about your money.

"Just having all the information in one place and presented in an appealing way doesn't necessarily help someone make better decisions," Breyault says.

I'm not a huge Suze Orman fan, but I believe personal financial management sites and apps could take a page out of her book.

They ought to tell users things like: Can I really afford that? Better still, they should be offering more personalized guidance and advice on investing and financial planning. (A few are starting; I just blogged about one instructive site that shows you how to manage your debt better, Credit Sesame.)

"PFM makers say, 'We'll help you and empower you,' but their tools don't really do that," Shevlin said at the online chat. His report claimed that more than 10 years after financial institutions began implementing these types of websites, "the promise of PFM has yet to be realized."

Shevlin thinks these tools will only catch on if they offer "strong advice capabilities." Two he says that do this well: BillShrink.com, which analyzes your credit card, wireless and TV bills and recommends alternatives (it's parent company is Truaxis) and Billguard, which spots fraud charges on your credit- and debit-card bills.

Fears About Privacy

Privacy concerns are another reason many of us don't use these money-management tools. Laying bare the details of all your holdings in one place is a scary thought, since it would only take one shrewd hacker to get his grubby hands on the data and wreak havoc.

"If you don't guard your password carefully, someone else can get all of your financial information," Linda Sherry, director of national priorities for the advocacy group Consumer Action, said in the online chat. "I've read that one bank is thinking of letting you use Facebook to log into its PFM. That sets off a lot of alarms to me."

And how will you get hold of all the info you've stored, Breyault asks, if the hot new PFM startup you're using isn't around next year?

A Boon for Lower-Income Americans

Done right, personal financial management tools could be especially useful for low-income Americans, particularly the elderly. These are exactly the types of people who can't afford to make big money mistakes.

I was heartened to see that in the U.S. Treasury Department's MyMoneyAppUp Design Challenge -- a competition to find the best new mobile app ideas and designs to help Americans make smart financial choices -- one of the winners was MOOLAH, specifically aimed to assist lower-income households.

The brainchild of Pamela Chan and Eric Tyler - policy analysts for the New America Foundation, a nonpartisan think tank - MOOLAH would let users create budgets and recommend related social services and financial products. I'm hoping the $5,000 prize will help Chan and Tyler get MOOLAH on the market.

How to Get Started

If you haven't yet used a personal financial management site or app but are thinking of trying one, Breyault recommends taking baby steps.

"Start small and see if the PFM actually helps you," he says. "Maybe try tracking one or two of your financial accounts for a month. If it helps you save time, then consider adding some more. I would advise someone with multiple accounts - which folks in their 50s and 60s often have - from loading up their entire financial portfolio into a PFM without test-driving it first."

Otherwise, you could find yourself with a bottle of migraine medicine, wondering whether PFM actually stands for Poor Friggin' Me.

Founded in San Francisco in 2008 with a coinciding app released early this year, Airbnb is a home-sharing service which opens your house or apartment to strangers looking for a place to crash. Conversely, you can use Airbnb to find a place to stay without ever renting out your own place. The company currently offers more than 100,000 listings in over 192 countries, and boasts 5 million nights booked.

Airbnb is not only great for finding a cheaper nightly rate. Fewer hotel rooms also mean fewer carbon emissions. Of course, renting out your room to a complete stranger always comes with a risk, as one woman discovered last July when she returned to find her home ransacked by meth addicts. In response to this incident, Airbnb significantly increased its insurance coverage.

Launched early this year in New York, CLOO' stands for Community + Loo. Yep, it's an app for sharing bathrooms. According to its website, "CLOO' is based on one simple truth: We all have to pee." CLOO' has a network of registered users, or 'hosts,' who have offered up their bathrooms for a small fee. The app even offers a "community rating" of hosts, so that you can consider both safety and sanitary precautions before selecting a spot. The app also utilizes social media outlets such as Facebook (FB) and Twitter to help you identify nearby hosts with mutual friends, "turning a stranger's loo into a friend of a friend's loo." Finally, finding a clean, available restroom in the city is no longer an impossible task.

The Local Dirt app allows users to locate, buy, and sell local foods in their area. Launched in early 2008 in Madison, Wisconsin, the concept not only supports local economies, but also cuts out the high emissions spent on transporting grocery products across the country. Better yet, Local Dirt is funded by the National Science Foundation, so it's free for the rest of the year. Unfortunately, this perk ends December 31, 2012; from that point on, membership will be $360 annually. Still, this is a low price to pay for access to fresh, local products year-round, and chances are you'll still pay less than you would at your local Whole Foods (WFM). Businesses and large organizations can typically have their orders delivered; individuals usually have to go to the source to pick up their local goods.

Launched in 2009, San Francisco-based ThredUP is a start-up website designed to help busy parents save money by giving them the opportunity to buy and sell their children's hand-me-down clothing. Since kids grow so quickly, they outgrow their clothes at an alarming rate. ThredUP will pay you for your kids' outgrown duds, as well as give you access to popular kids' brands up to 75% off. The best part is you can do all of this from the comfort of your own home -- just leave your bag of used clothes at your door, and ThredUP will take care of it for you, shipping costs and all.

For those looking to buy, there is a $6.95 flat shipping rate; orders typically arrive in seven to 10 business days. While ThredUP is currently only available in the US, the company hopes to expand into international markets by the end of this year.

A self-proclaimed Netflix (NFLX) for books, New Jersey-based Bookswim is a book-rental service with no due dates, late fees, or shipping fees. There are four different schemes -- a customer can rent either three books, five books, seven books, or 11 books at a time, and pay rates ranging from $23.95/month to $59.95/month. BookSwim advertises availability to both New York Times (NYT) bestsellers as well as classic literature. It also features personalized reading recommendations, updates for when your favorite authors publish new books, and the option to purchase any book you borrow at a discounted price, should you choose. The site is also devoted to conservation; not only does the start-up conserve paper by reusing books, but they have also pledged to plant a tree for every gift card bought. To date, BookSwim has saved enough trees to reduce carbon emissions by 10 metric tons.

Popular among fashionistas of all ages since its launch in late 2009, Rent the Runway allows women of any income bracket to enjoy designer dresses and accessories at only 10% of the retail cost. Based in New York City, Rent the Runway offers both a four-day and and an eight-day rental option, and covers both shipping and dry-cleaning costs. To ensure the dress fits, you're allowed one back-up size free of charge with each order. Rent the Runway also offers free stylist consultations to help you decide which dress is your best fit. (See related story: Will "Ethical Fashion" Become the New Norm?)

The be-all end-all of the sharing economy, San Mateo, California-based Rentalic launched in 2010 as a person-to-person marketplace for renting any and all reused goods, ranging from wheelbarrows to mini vacuum cleaners to VW Beetles (VOW.DE). It's not limited to items, however; the Rentalic marketplace also offers services and real estate as part of its renting platform. Like most of the previously mentioned innovations, Rentalic not only increases usage of items we already have or that are already in use, but also strengthens community ties and helps out the environment.